The Evolution of an Automotive Customer

People generally don’t just wake up in the morning and say, “I think I am going to buy a car today.” Sure most of us would love a new car right now, but without a need or compelling event we continue to drive the car we have. Something has to happen to trigger that buying emotion. For some people that buying emotion comes and goes as quickly as a 30 second advertisement; for others it could be a year of planning and research.

When that urge does arrive, people can choose to interact with us in one of four ways, by e-mail, chat, a phone call or in person at the dealership. Thus I like to call these four contact points “the stages of a customer’s evolution.”

The lowest form of customer evolution is the Internet, we’re just a bunch words on a computer screen to one another, and unfortunately our industry does not employ a whole lot of wordsmith’s out there. Those of you just giving out prices are not even selling the value of your product or dealership! And we wonder why our industry has become so commoditized. Experts will tell you an Internet lead can often take several months to close. The problem, most of the people in our business are looking for instant gratification. Why should a salesperson follow-up with somebody for months when they can probably just look out the window and find a buyer sooner than later? Now I don’t like this anymore than you do, but this is reality. Without a rock solid follow-up process and people willing to execute, your dealership is missing opportunities.

A chat session takes us to the next step of our evolution process. Unlike an e-mail which can consume days of back and forth conversation, a chat session allows us to accomplish a lot more in a shorter time frame. According to Todd Smith, President of Active Engage, the average chat session generally last about 9 minutes. If done properly it can lead to a phone conversation where it becomes much easier to schedule the appointment.

The phone call, our next to last step in the evolution process allows us to use words and voice inflections, making it easier to secure a visit to the dealership in the form of an appointment. I can tell you from years of personal experience, it’s lot easier to paint a mental picture and build a relationship on the phone than it is to do so in an e-mail or chat session. The phone is the bridge that will help you appoint more Internet and chat customers to your dealership.

As you probably guessed, the final stage of evolution is when the customer makes the decision to visit your dealership. Now we have the ability to use all of our behavioral cues; words, tones, gesture, posture and facial expressions. This is a much more personal experience for you and the customer, and will provide you with best opportunity to earn your customer’s business.

I decided to write this article after recently observing a well recognized trainer providing his phone-up theories during an online training session hosted by a nationally recognized lead provider. This trainer, who will remain nameless, suggested that instead of giving out information on the phone, the salesperson should get the customer’s e-mail, and then e-mail that information to the customer. I couldn’t disagree with this more! You’re going backwards when you choose to employ this methodology. What if the customer does not agree with the information provided in the e-mail? On the phone we can at least try and validate our information, or overcome any objections we might face. No to mention we’re still required to phone that customer after sending the e-mail in an effort to try and secure an appointment. Getting a customer on the phone a second time can be a very difficult process. In my professional opinion, we need to make the most of that initial phone call and provide the customer with the requested information in order to try and secure the appointment. I emphasize “requested” since many salespeople go above and beyond the call of duty and provide way too much information, thus they de-motivate the customer from visiting their dealership.

In the first three phases of evolution we’re trying to sell an appointment, not a vehicle! Sell the vehicle in your showroom and you’ll close more deals.

With fewer and fewer customers visiting showrooms these days, you had better learn how to master the first three stages of evolution, that’s if you want your fair share of customers visiting your showroom.

I plan to write a follow-up to this article in the next few weeks, but first, I would like to hear your thoughts on this matter?

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Comments

Jerry,
You and I already know that we share the same beliefs about the phone so this article was spot on. Great job.

The only reason to capture an email by phone is
a) for the extra piece of contact info
b) to deconstruct the lead and search databases to help with rapport building
c) to email appointment confirmation reminder emails with directions, photo of who to see, etc.

Right on Jerry! I especially like this part: "Those of you just giving out prices are not even selling the value of your product or dealership! And we wonder why our industry has become so commoditized."

That's a pretty broad generalization, especially given the extent to which rapport can be developed online prior to phone, and prior to the store. Customers continue to shop for a salesperson, whether on the website, email, chat, phone, or the in-store, these are all just different elements of a continuum of communication. You screw up any one of those up and the result is the same.

If discount is the only tool in your kit, it doesn't matter where you give the gross away, it's still gone. But used strategically, price (not discount) is an important tool that can help prospects develop rapport with right sales person. Good thing, because that online relationship can be the difference, the connection that helps one re-engage lost customers after a poor in-store experiences.

I agree with Larry, the key is to understand what motivates a prospect to become a customer. And that's the missing ingredient, the thing that handcuffs many dealerships; price is just a symptom of the underlying failure, not the cause.

I agree with everything you said. I work in an internet office working emails and phone calls. The phone calls are by far the most productive. Emails do take a lot of time to follow up and the response to them is very small. When they send a phone number with the email, I call them and the response is as good or better than the phone calls coming in. Good article!

Barry Wrote: "I agree with Larry, the key is to understand what motivates a prospect to become a customer."

Barry,

I always tell salespeople that when they start thinking like a customer and understanding the customer from a different perspective, it does make it easier to associate with the customer and earn their business.

With an Internet lead you're only "words" on a computer screen. With the phone you have "words & tones." In person you have all the behavioral cues that make a salesperson good. They are: words, tones, gesture, posture & facial expressions.

Where do you think you have the best chance of establishing a personalized relationship with a customer? Obviously in person. If you can advance a customer from one stage to the next, you're progressing in the right direction. Now that's what I mean when I talk about evolving.

Understanding customer behavior is paramount. Basically Jerry is just conveying how important it is to recognize the path in which customers are communicating with you. If you don't possess the skill set to interact properly in each stage you are missing business. In other words stop short cutting and become a Master at all facets of the game. Great post Jerry!! BTW Shawn Morse and I have been spreading major rumors about you. Larry take some time and revisit the post I think you've overlooked a thing or two.

If it's an Internet lead and I can reach the customer on the phone, I will then increases my chances of overcoming any price objections I may face while on the phone. In an e-mail I won't ever hear from them again if they don't like what I have to say. Obviously when the customer visits the dealership it becomes a whole new ballgame.

Nice article Jerry, and good thread. Note that our desired priority of communication is the opposite of what most modern prospects want (we want showroom ups, prospects want to hide behind their email). Why? The modern day consumer does not want to experience the traditional high pressure sales-tactics and lack of information they had in the past when negotiating.

The pendulum has shifted, and control has moved with it to the consumer, who has much greater knowledge and can choose how they interact with us. Future dealers will be unsuccessful if they sit on their thumbs, and still wait for and only focus on their showroom ups. Successful dealers will learn and master how to work with prospects in every mode of communication.

On a side note – you can integrate voice inflection and facial expressions with an email lead – use Flip video! Photos and video allow you to personalize yourself and build value in the Internet lead process.

Kevin I would go so far as to say they hide behind email, that's just the most convienient way for some people to commuicate or in some cases just what they prefer.

In anycase you're right any successful dealer will have work on and improve skills in all forms of communication.

Flip video is an interesting concept. Have you had any trouble wiht blocked emails with attached video, we ran into that in 2004 with a video email program at AIM. Curious to see if one email one video gets thru.

Smoking out the noise and getting the dialogue rolling is not easy. Its easy to become an "information appliance" for the shopper. Flipping the tables and becoming the "Tour Guide" takes effort and skills.

Selling the appointment and not the car is the quickest path to the sale and has the highest ROI, but, you've got to build that rapport (read: qualify) before they trust you to cross the bridge.

IMO, the opening question, building rapport and selling the appointment are where its at!

@Larry – agreed, email is for many the preferred method of communication, and you can see that with your website analytics. Most of these folks are shopping during work hours today and likely don't want to be heard on the phone with a car dealer when they are supposed to be working…

Flip is working great. Of course, there are always issues with some email domains (especially work domains that can have extensive filters) – BUT – this can also be used as the opportunity to speak on the phone when letting them know you sent them a short video.

I sort of agree with your evolution concept, although I think that the internet is far more interactive than just "words" – I really like the Flip Video and HallMark Cards ideas.

My BHAG is to decipher WHY the prospect who contacts me via an internet lead CHOSE to do that rather than the alternatives??? If we all agree that roughly 20% of the traffic will actually fill out a form to submit a lead…can we then figure out if they are somehow unique? If they are unique, can we construct the proper response which will gain the best engagement ratio???

@Joe – "building rapport and selling the appointment are where its at!" right on.

I've never trained some one to go from phone to email but ALWAYS from email to phone. Of course this is where most dealers are challenged.

However, it's imperative to obtain the customers email during phone conversation for any additional follow-up or to send that online thank you card. Which works by the way. I was using Blue Mountain Online cards years ago. It works but like anything you need to be consistent.

Here's one for you . During the training I had a sales person tell me "if there's no phone number then I'm done with the customer, if you don't want to provide me the information I need to help sell you a car, then go somewhere else." Dude was straight up serious. Don't kid yourself, mentality is throughout the dealer body.

Of course I gave him an interesting look and tried to provide some reasoning on why he's missing out on sales with an approach like that. Maybe I got through…

@Kevin – are you using the Flip share software? I'd love to whitelabel it. I've sent as far as contacting a few higher ups there to see if it was at all possible. I was denied each time. I love the "card" template the software provides.

@Jeff, we are just using the Flip share software that is installed on the camera. I have found that if you do a quick demo (setup a test lead, hit stopwatch when it arrives in CRM, go outside and do a quick clip of the car and sales rep, go inside and send it, stop the watch…) and the sales rep sees how quick and simple you can send it, then the idea is quickly embraced…

I couldn't agree with you more. I have made it my mission to train my internet sales team to be able to use the word "no".Selling the appointment and not the price/car/etc is huge. Too much information keeps customers away and gives them a reason to never visit. A well worded way of telling someone that they need to visit the showroom to get all the information they want is way more powerful than giving up that information right away.

I still think it is all about getting people on the phone. When it comes to email, the national email open rate is somewhere about 11%, which means that people ignore about 89% of their emails. Can you blame them? All of the useless spam and junk that hits our email everyday can get very annoying. Email is good to try to get a customer engaged and if used properly it will help get the customer on the phone.

When it comes to pricing we need to remember that only about 20-25% of customers are solely motivated on price. However, people still use price as a barrier. This scares off a lot of untrained or improperly trained people in the business which leads them to give away gross. The important thing to do is to look at the big picture and find out what is really the reason why they want to buy a vehicle. Also, don't forget to sell them on a value package proposition. If you build value, reasonable consumer will ultimatley buy from you.

The bottom line is that you need to separate yourself from the competition. If five dealers in one area are doing the same thing, do something different to peak the customer's curiousity. At that point, you will succeed.

Stan wrote (Stan, your getting quoted a bit here) – "When it comes to pricing we need to remember that only about 20-25% of customers are solely motivated on price. However, people still use price as a barrier."

We just had a joint Local/Toyota Market study performed and lowest price was number 7 on the list of what a customer is looking for when purchasing a vehicle. I tell my sales people all the time "Price is the carrot the customer uses – it's all they have to use to their defense." Understand the customer and move on.

@Jeff I don't know if I would call it a carrot or about it being #7 on the list, I can tell you this. We are analyzing the results of a large joint MBU and UserTesting.com study where we have filmed over 100 users as they search for a vehicle online.

I am 1/3 of the way through the analysis and the numbers so far are that in 60% of the cases prices was one of the deciding factors for the customer to choose and contact that dealer, but it was never the only factor.

Will present all the findings at #DD9 and will be posting a summery and all of the videos on the MicrositesByU.com blog.

As with just about any study, they can be picked apart. I too think 7 is further down the list than what my gut tells me and other studies I have seen.

I also think when I customer is truly in their car buying/shopping phase, they many times morph into someone different. LOL. Depending what phase of the shopping process the customer happens to be in can yield different results/answers.

With all that being said, we still know that price on a majority, is not the sole reason of purchase and if we can use studies and information to reinforce to our sales teams, it will only help with.

I know alex we have not put the crossbrowser code up yet for MBU it will be soon. There is nothing on MBU blog yet anyway this will be the first entry. If you want to check out the new WP design you can go to http://www.micrositesbyu.com/MicrositesBlog/ but as i said there is nothing there, yet.

I know that surveys surely can be manuipulated to say pretty much what ever you want. That's why we deciced just to film a large sampling of customers as they search for a car and dealer online and look for commonalities in their behavior. This makes for a much more clean and objective case study. We are posting all of the videos to allow others to veiw and draw their own conclusions from thier observations of the behavior.

IMO, "The shopping process" steps that a shopper makes are similar in all high ticket sales.

This also highlights the shopping opportunity that AutoTrader.com and Cars.com should exploit. Currently, AT and Cars is suffering from a gigantically bad reputation, based specifically on poor visibility.

Should the CEO at either company (AT or Cars.com) dare to open this gateway to the dealers home site, then the flood gates would open and the we'd all "see the light"! 😉

Understandably, neither CEO wants to do this for fear they loose traffic themselves. BUT, what they'll gain is their first chance to raise rates in years.

Mr Perry or Mr Golub, if you entertain this idea (of linking to dealers sites), to boost your value, you may want to link to a dealer landing page 1st, make it newspaper like with a monthly sales theme, allow the dealer to display a video, present a link to the dealers site AND present an exclusive offer that requires an opt-in. ( put your marketing guys headed in this direction: http://www.google.com/search?hl=&q=best+squee… )

Joe I have been trying to get Cars and AT to understand the value of squeeze page, landing pages, microsites and conversion paths for years. The term "Too big to get out of your own way" comes to mind.

Problem with that upstart is it's business plan. The plan recognizes Car Dealers are NOT self-serve, they need their hand held. You need sales reps on the ground selling the program to produce more profits. Simply presenting inventory and waiting for dealers to sign-up wont work (see google adwords).

@Alex, I know what you mean and I agree with you on that aspect. A value package is not supposed to be free oil changes or tires for life. It just needs to be a unique reason why people should choose you over anyone else. Your value package can have things that will not cut into your gross. For instance, if your dealership has a play area or starbucks coffee, you can add that. If your dealership has a cafeteria, you can use that. Remember, you want to be different from everyone else but also a little better.

I was recently consulting a store that had a video game area setup. That is great to let customers know of. Let the customers feel like buying a car is more convenient for them.

Intersting site Joe sorry I missed that post. I love thier business model: "Car & AT you go get all the listing we'll aggrogate the data and display it in a way that makes sense to the customer then sell the lead back to the dealer.

Problems:

1. They are just a vunerable as AT and Cars if the dealer body ever figures out they can compete with them in search.

2. They are most likely to be come the orbitz of the car business. A presenter of data with no action monitizable action that can come from the data presented. Just a ad site.

To make any site like this work there has to be a compelling reason for the customer to want to go through this site as oppsoed to just going direct to the dealer.

CarGurus is a lead wholesaler. It leverages its awesome SEO work and strong call to action VDP work to resell its lead traffic to the extensive sales network of Cars.com and Dealix et al.

That CarGurus.com CEO Langley Steinert is not a 'one trip pony'. His business model and the TripAdvisor are radically different.

Gee… He built the ultimate Business Rater site, why not replicate it in our space?

Roll with me on this. Take a minute and consider the structure of TripAdvisor in the Hotels market and how a similar could be used in the automobile retailer biz. Langley S. saw the money and clearly saw the opportunity in the classified ad/lead generating side. I find that very interesting… very revealing.

"2. They are most likely to be come the orbitz of the car business. A presenter of data with no action monitizable action that can come from the data presented. Just a ad site. "

Orbitz Larry?

Ya, I'd agree with that. CarGuru is in the order flow just like Orbitz. I am aok with that, but I've been looking for a game changer to show up and rock our world. Our industry is ripe for the PriceLine.com business model. If he twists the knobs just right and moves his model more towards PriceLine and if it resonates with the dealerships upper management, lookout.

Also, If Larry S and the team can figure it out, Look at the riches that await! Compare the company size of Orbitz vs Priceline

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Editors

Jeff Kershner

I’m the founder of DealerRefresh. I got my start in the dealer business when I was 18. From there I've worked throughout several departments within fixed to variable ops. Whether it’s managing the desk, perfecting sales process or studying online marketing and media trends, I absolutely love this business and the challenges it brings. On top of keeping up with DealerRefresh, I consult with dealerships and key industry businesses. My passion has been and continues to be helping dealers leverage new media to sell and improve customer service.

Alex Snyder

2019 marks Alex's 30th year in the car business. In that time he has had a front-row seat for the rise of the Internet and has been working to bring the online and offline dealership experience closer. Whether you knew him from his life at Checkered Flag or his years with Dealer.com/DealerTrack/Cox Alex has remained an opinionated DealerRefresh contributor who enjoys nothing more than to poke at the unsaid truths in our industry. He also helped found FRIKINtech.